Archive for the ‘Economics’ Category

Now that some of the dust has settled in Ireland, it might make sense to see what happened in Ireland. While the former Finance Minister Brian Lenihan is blamed for the stupid arrangement by which the banks bond holders were guaranteed to be repaid in full. I think that many people overlook the role that Patrick Honohan the governor of the Central Bank of Ireland, and a member of the European Union Central Bank played.

As Morgan Kelly points out in a great article in the Irish Times, Honohan not only stated that the bank losses where manageable, he also basically forced Ireland into the bail out the the ECB wanted to force on Ireland by making public statements to bring this about. It seems that between Honohan and the U.S. Treasury secretary Timothy Giethner, the people of Ireland have been forced into a perpetual spiral of debt.

Of course that makes the ECB and for some reason Timothy Giethner happy. I don’t know what that says about the people who would do that.

Whether this is true or not, I found several sites that had reported that John Parsons Wheeler 3rd (the son of Col. John Parsons Wheeler Jr. (desc.) who also was working for a defense contractor) has been found in a dumpster dead. It’s been reported that the John Parsons Wheeler 3rd had been a lawyer, an officer in the U.S. military (which anyone should be able to get his DD-214 now since he is dead, God rest his soul), had served in 3 presidential administrations (that is more than anyone but George H. Bush), built the Vietnam Vet Wall, and was last the assistant Secretary of the Air Force would gather some type of news coverage. After all her was an arguably decorated U.S. Military officer who had been in 3 presidential administrations, and yet there are no real leads.

Unless you put credence in what former Forbes business reporter Benjamin Fulford says in his video interview and discussion with David Rockefeller if you did believe what Mr. Fulford says, things like this are going to happen more and more. Watch the video, unlike normal television, you don’t have to pay to watch it, and you can watch it relatively unedited (I would say that there was some addition footage added, but I can’t say want might have been deleted). If you want to see what is really going on, you might as well see what Mr. Rockefeller has to say.

You also find about George Soros while you are at it. I don’t claim to know anything more than what these two people have to say directly from their mouths, not what someone else says they say. But if you give credence to Mr. Fulford, who was able to sit down with a camera crew and interview David Rockefeller with Mr. Rockefeller’s full knowledge and consent, lots of people are going to die quickly if things don’t change.

It seems that there is a lot of disinformation about Ireland, and to some extent Iceland (which doesn’t need a bailout for reasons I will explain). While Ireland has a strong economy (link) with savings rate of 12.3% and industrial output up by 12%, the country is in crisis. The reason is that the corrupt Fianna Fail party is selling out Ireland to the banksters, unlike Iceland which told the banksters, too bad, you gambled, you lost.

So while the corrupt government of Ireland (which pays the Prime Minister more than twice what Barrack Obama makes as President of the United States) sells out the people of Ireland, Iceland is exiting it’s recession. The Guardian Reports:

Iceland’s president Olafur R Grímsson said: “The difference is that in Iceland we allowed the banks to fail. These were private banks and we didn’t pump money into them in order to keep them going; the state did not shoulder the responsibility of the failed private banks.”

The answer is clear, stop bailing out the banks and improvising the people. Unfortunately most people are duped into believing that it’s better for the people to starve than for the corrupt banks to take responsibility for their own greed. As long as the banksters can get free money and shift the risks onto the poor and downtrodden with the complicity of the corrupt governments, people are going to be sold into a perpetual serfdom.

Of course, China might have not acted so quickly if two things hadn’t happened recently, the Japanese dispute over islands, and the U.S. deciding to launch an investigation of Chinese subsidies of “green energy”. Now that is just silly as it seems that all “green energy” projects are subsidized, but heck the United Steelworkers Union was crying about it, and Obama all too willing to do whatever the unions want, especially in a tight election year with the election weeks away, displayed his vast knowledge of international relations, and told China that he wanted to, as Saturday Night Live puts it, do sex to them (see video)

Obama is doing a fantastic job, hopefully someone can stop him before he obtains his goal of completely destroying America.

[Update: I forgot to explain the importance of Rare Earth materials, basically they are used in almost all high tech devices, from batteries to flat screen tv’s, without them, there are no wind farms, no hybrid cars, no cell phones, well you get the picture]

Recently I was talking to someone, and a person who wasn’t even in the room emailed me later to tell me how wrong I was about one of the reasons for their electricity bill being increased was the decision of Exelon to shutdown the Zion Nuclear Power Plant. The person who likes to follow me around and find things that I didn’t state with enough accuracy (would be nice if he held the President of the United States to the same standards he expects from me, but I guess I am just that much more important to him) emailed me a wikipedia selection that said:

The Zion Nuclear Power Station was retired on February 13, 1998.[1] The plant had not been in operation since February, 1997, after a control-room operator accidentally shut down Reactor 1 and then tried to restart it without following procedures.[3]Reactor 2 was already shut down for refueling at the time of the incident. ComEd concluded that the plant could not produce competitively priced power because it would have cost $435 million to order steam generators which would not pay for themselves before the plant’s operating license expired in 2013.

Here’s the part he left out from that selection:

This analysis was predicated on no license extension which at the time was the norm, however since then multiple plants have replaced steam generators and extended the license by 20 years.

Now, I know that Exelon had no desire to keep the Nuclear plants around (how? because I talked to the people at Exelon in person years ago about this issue), for political reasons, so they had ZERO incentive to apply for a license extension in any case, so they were not going to pursue something when they didn’t have to, and frankly I don’t blame them.

People might not see the link between the decision to keep Zion offline for the last 12 years, and the higher cost of electricity, but there is a correlation. According to the Madison Record:

a current or former Exelon insider has apparently confirmed that the main reason Zion has been kept closed is because withholding the supply intentionally keeps prices higher for Exelon’s other supply.

There are other good sources of information about the shuttering of a viable power supply for the state of Illinois (see this, this and this) but the reality is that many people think of Nuclear Power as evil, and think that wind and solar power are better for the environment. The true costs of wind farms has been discussed elsewhere, and seems to be a confusing subject, but it would take 600 square miles of wind farms to produce the same power that Zion used to produce. The fact is that the U.S. cannot reduce carbon emissions, supply the same amount of power and shutter Nuclear Plants. Something has to give, and it will be the American people who suffer, and companies like Exelon can profit because of this.

Once again, this isn’t the fault of Exelon, rather it’s the people who believe that the masses should live at the techonological level of the 1900’s that are the problem, and they will spin the facts whichever way to bring back the times of the serfs.

The said thing is the masses who believe that they will be spared from serfdom because they supported the agenda of stupidity.

Recently Obama made a speech where he was pushing the 50 billion dollar infrastructure investment, as if it was something new. It’s not. That is the ongoing money that has been allocated to maintain the roads, tracks, and airports. As Roy Tov points out, the whole thing amounts to:

3.7% of the roads, 2.8 of the railways and 1.9% of the airports

Wow, such an investment in the future. At the same time, it’s been reported that Rahm Emanuel has some really interesting thoughts about the unions, which leads me to wonder what is going on. Well it doesn’t look good, according to GlobalResearch.ca, it’s estimated that banks are still holding at least 20 trillion dollars in “toxic assets”, this is one reason even though businesses have reserves the economy is not getting better, because the next hammer is going to fall soon. And that might be one reason why Barrack Obama was selected to be the President, after all everyone gave him a pass when he was running for president, no one wanted to investigate his shady background, or his ties to the CIA, rather any questions were easily deflected with the “you are just racists” response.

And while the jobless rate increases, the fact that it wasn’t a completely horrible number somehow shows that we are in some strange recovery. So as the economy contracts by at least 1.3% based on GDP (see this article by Stephen Lendman from Chicago for a much better analysis) it seems strange that people aren’t rising up in anger at the way the car is being driven over the cliff. But then again, a large number of people still work for the government, and as Mort Zuckerman writes in the Financial Times (hopefully the link works), the whole term public servant has become inverted because the so called servants are now the masters in America, with better. well everything than the rest of the people.

And therein lies the problem, the “public servants” with more paid time off, better connections to politicians will continue to milk the rest of the economy until things completely explode, the question is not so much a matter of if, but rather when, and given the state of affairs in the United States, with mandates for health care, schools, and no mandates for police, and an unwillingness to even enforce the laws restricting criminal entry into the country, the collapse will be uncontrollable.

Christopher Story, the editor of International Currency Review, who had long been reporting on the underhanded financial dealings involving the highest officials in the United States has passed away. This is sad news for those who believe that the people in positions of public trust should be held accountable.

Oligarchy- Since honor tends to be equated with wealth, wealthy people tend to gain power

Democracy-Rule by the masses to deal with the excesses by the oligarchs

Tyranny-Rule by a “democratic demagogue” who takes absolute power and is corrupted thereby

I realize that Plato is long dead and buried. But if you take a look around you can see that many governments are defrauding the governed on a staggering scale. What is more surprising is that the vast majority of people feel that they can do nothing about it (I don’t really blame people on this one). Dr. Henry Makow recently had a series of articles that purported to be by someone who is part of the behind the scenes puppeteers. In response to those articles someone wrote an article about the fraud that is the sovereign governments of New Zealand, Australia, and Canada. Which seems to indicate that we are nearing the end of the third stage of government on a GLOBAL scale.

I believe that the British Monarchy did a great bit of political slight of hand by “granting” the countries of the British Commonwealth their independence, thereby getting 54 votes in the U.N. In other words, the difference between what people believe is going on, and what is going on behind the scenes is amazing.

Members of the commonwealth will argue about minor things, but they form a collective, which, when tempered with the elevation of the EU to a de facto state at the UN, serves only to marginalize the other European powers. Of course the people of England, Scotland and Wales will get a bum rush, but heck the Windsors who rule the Commonwealth, were prior to 1917 the German House of Saxe-Coburg and Gotha (makes you wonder what the point of World War I was then, doesn’t it?). The arguments that they lost power with the Lisbon Treaty (the de facto constitution for the European Union) are a little overrated in my opinion.

More to the point though, we need to look at history to see the trends that go through time, and while Plato might well be correct in his summary of the rise and fall of civilizations, there are more recent observations about what is going on. To quote from two time Medal of Honor recipient Maj. Gen. Smedley Butler:

And let us not forget the bankers who financed the great war. If anyone had the cream of the profits it was the bankers.

It is true today, that the biggest fraud that is perpetrated today is that the banks should be forever bailed out from their “losses”. Now banks have a great system, they create money out of thin air, and then cry when they don’t get back more money than they created. It’s a great system….for the banks. While the rest of the world is struggling, the banks are still getting bailed out, the Special Inspector General for the TARP program estimates that the United States is on the hook for at about 23 TRILLION dollars via the Troubled Asset Relief Program (TARP). Makes you feel all warm and fuzzy about the bonuses that the banks are giving out.

A true sovereign need not indebt itself to private banks but can simply issue the money it needs. That is what the American colonists did, in the innovative paper money system that allowed them to flourish for a century before King George forbade them to issue their own scrip, prompting the American Revolution. It is also what Abraham Lincoln did, foiling the Wall Street bankers who would have trapped the North in debt slavery through the exigencies of war. And it is what China itself did successfully for decades, before it succumbed to globalization.

exporters by guaranteeing term financing to creditworthy international buyers, both private and public sector, for purchases of U.S. goods and services.

So in other words, it’s just an insurance company at the present time,and even though it can create loans itself, it is limited to only helping international (e.g. non United States based) entities, or at least that is how it is currently applied.

So, we are left to stand around while the banks (actually the true owners of the banks) are given the real wealth of the planet, and we, and our children, are condemned to servitude to pay off debts that CANNOT be ever paid off. Because the banks created the money by a bookkeeping entry and then wants that money back plus interest! Until people realize that the game is rigged to transfer real wealth into a the hands of a relatively small group of people and demand that the banks are no longer run for private gain at vast public expense, the situation will continue to worsen.

Sadly, the most likely scenario is that the history that Plato discussed in his Republic will instead become the reality of tomorrow.

Recently I was quoting a study that was reported in Bloomberg a year ago about Green Jobs making at least 2.2 other jobs disapear.

A person I wasn’t even talking to started swearing at me and accused me of making up the study. Here is the actual study (pdf, local copy). Of course some people will claim that the Spanish University study is biased because it wasn’t written by Michael Mann, or Al Gore, the only people you can really trust about climate science.

But this isn’t about Climate Science, as dubious as that field might be, but rather economics. Of course, according the high priests of the Federal Reserve Bank, only people who have passed their PhD exams in economics can understand just how wonderful the world is being made by the banks. Apparently most people who think that bailing out banks while throwing the middle class under the bus are stupid, because people who make 6 figures or more are so much smarter than the person who is forced out of business because the government decides that more resources should be spent making gasoline from corn (see the BioFuel Hoax) and other ideas that seem to lack a sound basis in economics to me. But then again, according the the High Priests of the Federal Reserve, you should only believe what they say.

Recently there has a been a great deal of news about how the gold markets are being manipulated. Some commodity sites are even running articles raising the question of whether gold can go to $10,000/ounce!!

The reason that the price could go that high (which I think is unlikely) is that there is not enough gold to met the contracts in effect. In other words, that some (many?) of the numbers of gold that is in storage is not true. Even worse, is that some television stations have actually done some reports on fake gold bars (youtube). It’s interesting that this news is not being reported in the English speaking mainstream press.

My advice is still the same, have physical gold in your possession, perferably something that is of nusimatic (collectable) value. Let’s pretend that Obama is the second coming of FDR, FDR did order the confiscation of gold in the United States, so it HAS happened in the past, and it can happen again. I don’t have an answer for what you should do if the government comes looking for gold you bought online, but it still makes sense to have physical gold.

It’s being reported that Citibank sent out a nation wide addendum (you know the tiny print that banks send their customers), that said

Effective April 1, 2010, we reserve the right to require (7) days advance notice before permitting a withdrawal from all checking accounts. While we do not currently exercise this right and have not exercised it in the past, we are required by law to notify you of this change.

That is interesting, Citibank at any moment can restrict access to your checking accounts. Allegedly Citibank said the notice only applies to Texas, but why trust them at all.

According Ron Holland, a retirement consultant who lives in Zurich, the U.S. government is eyeing the private retirement accounts of U.S. persons. He states:

I fear that today the control, nationalization and ultimate confiscation of trillions in private US retirement plan assets is on the horizon. Rick Santelli alluded to the possible nationalization and forced investment into treasuries on CNBC as recently as January 8, 2010. There was also similar coverage on Bloomberg and Business Week.

Basically the U.S. government wants to be your retirement account manager. Of course we can count on them to manage your money to their wallets.

It seems that nature just isn’t playing along with my friends who believe that man made global warming is going to drown us as the waters rise 200 feet.

The Himalayan glaciers seem to be growing along with 11 other major glacier ranges. And it turns out the IPCC made up claims about how man made global warming was effecting the Amazon rain forest as well. Now, I am not too happy about the fact that it seems that the earth might actually be cooling, because, I worry about the future of food, especially since we are diverting food to produce biofuels, which a World Bank report says has driven the cost of food up by 75%! If the planet is cooling that means lower crop yields, and even more than the 1 Billion people that were need of food last year will need food in the coming year.

But some people believe that is really the point of the green movement, that a return to nature means the end of humanity as we know it. Prince Phillip, a big supporter of the World Wildlife Fund (a source of many of the claims that the IPCC made) thinks the Ebola virus would be a great thing to be unleashed in the world.

The U.S. Treasury does an annual gold audit report, unfortunately as has been widely reported, there are up to 600,000 ounces of tungsten-gold bars in existence, much of which the U.S. government is holding. What this means is that the value of gold could go very, very high, much higher than anyone has really realized. Any gold that is in large bars is suspect, leading the whole gold market to increasingly demand physical delivery of gold. Some reports indicate that the chinese uncovered that the gold originated from a United States entity.

Physical gold coins look like a really good investment right now, but then that’s just the sanity talking.

Some would say that the United States is bankrupt, and I agree that the government of the United States is morally and fiscally beyond bankrupt. That said, it seems that Obama wants to destroy any real hope of a recovery.

Let me explain. Obama doesn’t support the re-institution of the Glass-Seagall act provisions that prevented the same entity from creating credit and using that same credit that it created to invest. This was what created the dot-com boom, and it’s what put the banking system (which I am not happy about for other reasons) into the current state of affair.

Instead, Obama, under the guise of banking reform, will force banks (real ones, not the fake Goldman-Sachs banks) to make the loans that the government allows them to make, forcing industry to either look to China, Japan or Europe for large financial outlays. In exchange for these loans, companies will be encouraged to move their factories to those regions.

Obama is helping this move with GM announcing that it will start importing Chinese made cars last year, much of the funding done by the U.S. government bank that was explictly created for the purpose of moving business overseas as this article explains:

in practically every instance, U.S. taxpayers are tapped to subsidize loans and loan guarantees used to finance the export of auto manufacturing overseas. One of the chief conduits of this corrupt corporate welfare is the Export-Import Bank Export-import Bank (Ex-IM Bank)

The U.S. federal government agency that extends trade credits to U.S. companies to facilitate the financing of U.S. exports. (Eximbank), created in 1934 during the FDR administration for the express purpose of financing trade deals with Josef Stalin’s Soviet regime. At present, Eximbank provides over $15.5 billion in taxpayer-subsidized loans or loan guarantees annually.

So the only U.S. government entity that is called a “BANK” (the Federal reserve is not an agency of the United States government, though many people think otherwise) only exists to MOVE business overseas. This will accelerate under the current plans of the administration, in fact I think just the yapping about these plans are encouraging any reasonable business entity to find a non-United States international home.

The reality is that there is no longer any incentive for “large” banks to loan to small net worth individuals and businesses, and small banks are going to be forced out of the market because they are too small to be allowed to grow under the crazy Obama plan. In fact, the Obama National Socialism plan combines government with big banks to control every aspect of people’s lives.

An interesting example is how Scott Brown is characterized as “far right“. The real Scott Brown, has not ever stood for a smaller government, was a key part of the team that designed RomneyCare, and

Scott Brown joined the Democrats and passed legislation requiring Massachusetts to join the Regional Greenhouse Gas Initiative in a cap-and-trade pact among Northeastern states requiring power plants to reduce emissions or to buy credits from cleaner industries.

“Reducing carbon dioxide emission in Massachusetts has long been a priority of mine,” Brown said in a news release

Wow, he’s only far right in speeches, but otherwise, he and his fellow lawyer Barrack Obama seem to agree more than they disagree! If that is what passes for “far right” today, the United States is truly doomed. Let’s face facts, we are constantly given two bad choices by the media, which hypes up the minor differences between them, to make it look as if we are making some real choice, when the fact is that whichever one we vote for the end result is the same.

And this will only get worse. Recently the United States Supreme Court (e.g the visible puppet masters) said that corporations have even more rights again than humans and can now dump unlimited amounts of money into any election they want. In other words, the perfect marriage of corporations and government, at least if you own corporations and want serfs.

This is a bizzarre issue. Apparently the EU wants to make it illegal for shops to refund money for goods. This is an example of the madness of the EU that Ireland recently decided to give even more power to. Basically you might as well buy goods on E-Bay as from a shop in the EU if this law passes, because it would be ILLEGAL for the shop to give you a refund even if the product was defective!

According to the Wall Street Journal, on September 16th, China will institute new rules that will change how derivatives are handled by the Chinese banks. The Wall Street Journal claims that by requiring the trading partners of the Chinese banks to sign agreements that would cover defaults, China is taking money that could be used productively out of “play”.

Which the point, I think, China doesn’t want to be left holding the bag because other people get to play with the money that they are owed. In any case, it looks like September might be a hard month for the grossly unsupervised U.S. banking system.

This comes after a major Swiss bank has been advising it’s customers to exit the U.S. market as quickly as possible (WSJ).

One of the things that I have learned is just because you have inside sources that feed you 99% reliable information, doesn’t mean that you will always be right, just mostly. This doesn’t mean that your sources are “turned”, just that sometimes bad information is put out through lots of different channels. With that in mind, I will try to explain what I think is going on and why.

However, if you have signifigant assets you might want to look at Euro Pacific Capital, which is managed by Peter Schiff who has written books that have been endorsed by Jim Rogers and regularly is interviewed by Fox, CNBC, CBC, MSNBC and Bloomberg.